banking finance

SSS digitizing processes, services

July 31, 2019

STATE-RUN Social Security System (SSS) said it is in the process of digitizing its processes to improve transactions after President Rodrigo R. Duterte in his State of the Nation Address included the pension fund in agencies that need improvement.      In a press release on Thursday, SSS President and Chief Executive Officer Aurora C. Ignacio said the pension fund has started acquiring new digital infrastructure “to fast track the full transition of SSS core and business processes to digitalization.”      “As mandated by our Social Security Commission ex-officio Chairperson Carlos G. Dominguez in his first order of business when he took office last March, he instructed to speed up the transition to the digitalization process. This is one of his priority policies under the new charter of the pension fund,” Ms. Ignacio said.      Mr. Duterte, in his SONA last Monday, said the SSS and the Land Transportation Office (LTO), Bureau of Internal Revenue (BIR), Land Registration Authority (LRA) and the Home Development Mutual Fund or Pag-IBIG need to improve their services.      Finance Secretary Carlos G. Dominguez said in a briefing on Tuesday that the slow service of SSS is “costing the public money” and ordered the agency to develop a system using technology instead.      “I told them (SSS), you know the way you’re doing your business, our estimate is it cost you seven pesos to deliver P100. Now, that is too expensive. Other countries…if I remember right…Japan, 50 centavos to deliver a hundred pesos worth of benefits. We [in the Philippines] cost seven pesos. I said you cannot continue like that. That is not government money, that is the money of the people,” Mr. Dominguez said.      “So if it cost me seven bucks to deliver you a hundred…that means to say that seven bucks less I can give to somebody else… Your inefficiency is costing the public money, directly. So I said the first thing you do, you digitize, you do it, you develop a system that you can communicate with your clientele through modern technology, use the cellphone, you know, the smart app,” he added.      “Other countries can do it, why can’t we? You do it through computer and then we can…actually expand the benefits and make it easier for them to get the benefits,” Mr. Dominguez said.      At present, SSS’ online services include online applications for social security number issuance, payment reference number inquiry and generation, employment report submission, submission of contribution and loan collection lists, salary loan applications, certification of salary loan applications and filing for maternity and sickness notification.      Other electronic channels of SSS are My.SSS, SSS Mobile App, Self-Service Express Terminal, Interactive Voice Response System and Text-SSS.      The pension fund said in the same statement that out of 6,609 SSS-related concerns referred by 8888 and the government’s Contact Center ng Bayan, it resolved 99.55% or 6,554 cases.

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DOF studying impact of gaming ban on UHC funds

July 31, 2019

THE Finance Department is studying President Rodrigo R. Duterte’s directive for the closure of all Philippine Charity Sweepstakes Office (PCSO)-regulated gaming activities vis-à-vis its impact on financing the Universal Health Care (UHC) program.      “We are evaluating the immediate effects of the ban,” Finance Secretary Carlos Dominguez III said in a message to journalists Saturday.      Dominguez explained that they are “re-checking” how much the share of PCSO is on the over-all financing of UHC.      He also has no idea until when the ban would be in place.      The ban on all PCSO-regulated gaming activities was announced by the President in a televised message Friday night.      He attributed his decision to ban gambling activities such as lotto, small time lotto (STL), and "Peryahan ng Bayan" to “massive corruption”.      He said his directive is based on “the preservation of the resources of the nation”.      Earlier, health officials said about P257 billion is needed in the first year of implementation of UHC, which will be funded primarily by revenues from sin taxes. (PNA)

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Loan growth buoys Metrobank earnings

July 31, 2019

METROPOLITAN Bank & Trust Co.’s (Metrobank) net income in the second quarter rose 15.5% to P6.48 billion from a year earlier, buoyed by sustained loan and margin growth as well as fee-based profit, the lender said in a statement to the stock exchange on Friday.      This brings the bank’s second-quarter earnings to P13 billion, 18% higher than a year earlier. Metrobank shares fell five centavos to P75 each at Friday’s close.      “We anticipate that the second half will bring even better opportunities as government spending on infrastructure projects continues to accelerate,” Metrobank President Fabian S. Dee said in the statement. “We will continue to make strategic investments in key areas of people and technology so we can deliver more meaningful banking experiences to all our customers.”      Metrobank traced higher earnings to double-digit growth in operating income. Net interest income grew 10% to P36.5 billion, accounting for almost three-quarters of the banks P50.2 billion revenue.      Net interest margin improved six points to 3.83%. Loans and receivables reached P1.4 trillion, 6% higher year on year, while its nonperforming loan ratio was at 1.5%.      Metro bank said credit demand was broad-based, with both the commercial and consumer segments posting mid- single-digit growth from a year earlier.      Metrobank’s deposits rose to P1.62 trillion as of end-June from P1.56 trilion a year earlier. The lender’s consolidated assets stood at P2.3 trillion as of end-June from P2.2 trillion a year ago.

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GSIS bent on selling Manila North Harbor property

July 1, 2019

The Government Service Insurance System (GSIS) has reiterated its plan to sell its 672,645-square meter property at the Manila North Harbor, which the International Container Terminal Services, Inc. (ICTSI) is currently occupying.      “As a government entity that exists to ensure the integrity of the funds of its members, GSIS is determined to sell it through public bidding upon the approval of the Board,” GSIS President and General Manager (PGM) Jesus Clint Aranas said.      According to him, the market value of the property is approximately Php33.632 billion based on the zonal valuation as of 9 May 2019 and as reflected in the GSIS books as of 20 May 2019.      Enrique Razon, president and chairman of ICTSI, reportedly said earlier that GSIS has only a “naked title” with no right to use the property.      “That does not preclude GSIS from disposing of the property,” Aranas asserted.      Meanwhile, the Philippine Ports Authority (PPA) has committed to donate a five-hectare resettlement site under a memorandum of understanding (MOU) with the National Housing Authority (NHA), LGU Manila, ICTSI, and Manila North Harbor Port, Inc. However, the ocular inspection report of NHA reveals that the proposed relocation site infringes on another GSIS property occupied by informal settlers and allocated for socialized housing pursuant to E.O. 108, series of 2002 with an area of 1.2 hectares of which belongs to GSIS.      For its part, GSIS emphasized that “no entity can commit, offer, or convey any property which it does not own.”      GSIS was never consulted and neither did it approve or consent to such donation or commitment on the overlapping portion which is registered and owned by GSIS.      GSIS likewise demanded that the MOU be rescinded, modified, or revised to exclude the overlapping portion of GSIS-owned property from the five hectares that is committed by PPA under the MOU.      The PPA (under its present General Manager Jay Daniel Santiago) and through its Legal Department, in a reply to GSIS’s demand to PPA to rescind, modify, or revise the MOU last 4 March 2019, did not directly address GSIS’s demand but instead questioned the validity of the 43-year-old title and asserted that PPA owns the North Harbor Property, despite the property being registered under the name of GSIS.      PGM Aranas cited, however, the Office of the Government Corporate Counsel, which ruled in 2015 that the validity of the title registered under the name of GSIS may only be questioned in a direct attack filed before a regular court.      Meanwhile, GSIS has invited ICTSI to discuss the use and rental of the disputed property.  But ICTSI referred GSIS’s letter to PPA and deemed that “it may not be useful to sit down with GSIS without the participation of PPA.”      As to the issue of the overlapping GSIS property under the MOU, despite efforts to obtain a certified true copy of the proposed MOU and the 26 February 2019 Minutes of the Congressional Hearing and signing ceremony of the MOU, GSIS has not received such copy to this day.      PPA has also begged off from attending a meeting called by the Inter-Agency Committee for the Disposition of the Parola Estate and instead requested the Committee that a separate meeting be scheduled with PPA, NHA, LGU Manila, and the Housing and Urban Development Coordinating Council (HUDCC) only to discuss the MOU, without any mention of GSIS.       The GSIS was also informed by the Inter-Agency Committee that it will now be excluded from subsequent committee meetings since the Inter-Agency Committee no longer has jurisdiction over the disposition of lands owned by GSIS and other Government-Owned and -Controlled Corporations (GOCCs) citing Section 5 II (d) of R.A. 11201 (Department of Human Settlements and Urban Development Act).       Notwithstanding, PGM Aranas maintains that the state pension fund will take appropriate legal measures to protect the interest of GSIS and its members.

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Inflation seen to settle back to target levels

June 7, 2019

THE Philippines’ inflation rate is expected to return to its deceleration mode in the coming months after an uptick to 3.2 percent last May from only three percent last April.  In a report, Michael L. Ricafort, Rizal Commercial Banking Corporation (RCBC) Economics & Industry Research Division head, attributed the rise of domestic inflation rate to the impact of a weaker peso on imports in the early part of May, higher global oil prices and the dry season, which affected some agricultural products and the operations of hydropower plants. “However, these were offset/mitigated by increased rice imports with the Rice Tariffication Law and other non-monetary measures to increase food/rice supply to lower prices and better manage inflation since the latter part of 2018,” he said. Ricafort expects the resumption of slowdown of inflation rates in the coming months, with the decline forecast to be faster due to elevated inflation rate last year. He said that a one-percent level inflation rate in the third quarter or early fourth quarter is even possible. Last year, inflation peaked at 6.7 percent in September and October. Ricafort said adequate rice supply due to larger imports and higher harvest during the summer is expected to further ease inflation rate in the coming months since rice accounts for around 10 percent of the inflation index. “Further easing in local monetary policy by way of another cut in policy rates remains possible as early as the next rate-setting meeting in June 20, 2019 (or in subsequent months),” he said. He added that possible reduction in the Federal Reserve’s key rates this year is also a plus on the BSP policy rates. Also, ANZ Research forecasts average inflation in the Philippines this 2019 to be at the mid-point of the government’s two to four percent target band despite the marginal uptick last May. The economic research firm traced the higher inflation rate last month partly to the El Niño but pointed out that “weaker demand pressures and a high base effect will likely keep annual inflation in check.” “As such, we continue to expect headline inflation around the mid-point of the target band,” it said but added that “impact of the El Niño poses a key risk to the inflation outlook." Relatively, ING Bank Manila senior economist Nicholas Mapa said food inflation will be a key factor in the country’ headline inflation for the remainder of the year, but believes the final numbers will still remain within government's target. He added that this development will be closely monitored by the BSP vis-à-vis their decisions on the policy rates. (PNA)

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BSP forecasts May inflation at 2.8%-3.6%

June 5, 2019

HIGHER jeepney fare in the Visayas, as well as upticks on selected food items are seen as risks to the May inflation, which the Bangko Sentral ng Pilipinas (BSP) projected to stay between 2.8 percent and 3.6 percent. “Positive base effects” may also contribute to the “temporary price pressures” in the fifth month of the year, the central bank said in a statement released Friday. This as the rate of price increases continues to decline after peaking at 6.7 percent in September and October last year. Domestic inflation rate in May 2018 rose to 4.5 percent from 4.3 percent in the previous month. Average inflation last year exceeded the government’s 2 percent to 4 percent target band from 2018 to 2020 after it hit 5.2 percent. Amid the upside risks seen for the month, the BSP said lower prices of rice and domestic oil, along with the cut in power rates, are seen to counter price pressures. “Looking ahead, the BSP will continue to be watchful of evolving price trends to ensure that the monetary policy stance remains consistent with remaining price stability,” it said. The continued deceleration of inflation has led the BSP’s policy-making Monetary Board to slash the central bank’s key policy rates by 25 basis points early last month and analysts project more cuts in the coming months as inflation is seen to continue its downtrend. (PNA)

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